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Title: Consumer Sentiment in U.S. Climbs to Highest Since 2007
Source:
Bloomberg
URL Source: http://www.bloomberg.com/news/2012- ... mbs-to-highest-since-2007.html
Published: May 25, 2012
Author: Alex Kowalski
Post Date: 2012-05-25 10:28:19 by Brian S
Keywords: None
Views: 3299
Comments: 4
Consumer confidence rose in May to the highest level since October 2007 as prices at the gas pump became less of a drag on household budgets. The Thomson Reuters/University of Michigan final index of consumer sentiment climbed to 79.3 from 76.4 the prior month. The gauge was projected to hold at the preliminary reading of 77.8, according to the median forecast of economists surveyed by Bloomberg News. Cheaper gasoline and an improving housing market may help sustain consumers’ spirits in the face of slower job growth and slumping stock prices. The gain in confidence may signal Americans are more inclined to step up their purchases, which increased in the first quarter at the fastest pace in more than a year. “Gas prices have fallen, and that’s outweighing the fact that the labor market has been of some concern,” Erik Johnson, a U.S. economist at IHS Global Insight in Lexington, Massachusetts, said before the report. “We see consumer spending holding up.” Estimates for the confidence measure ranged from 76 to 79, according to the Bloomberg survey of 60 economists. The index averaged 64.2 during the last recession and 89 in the five years before the 18-month economic slump that ended in June 2009. Stocks held gains after the figures, with the Standard & Poor’s 500 Index rising 0.1 percent to 1,321.96 at 10:05 a.m. in New York. The yield on the benchmark 10-year Treasury note fell to 1.75 percent from 1.78 percent late yesterday. The Michigan reading compares with the Bloomberg Consumer Comfort Index, which declined in mid-May to the lowest level since January. The Michigan survey’s index of current conditions, which reflects Americans’ perceptions of their financial situation and whether they consider it a good time to buy big-ticket items like cars, rose to 87.2 from 82.9 the prior month. The index of consumer expectations six months from now, which more closely projects the direction of consumer spending, increased to 74.3, the highest since July 2007, from 72.3 in April. The unemployment rate slid to 8.1 percent in April, the lowest level since January 2009, Labor Department figures showed this month. Employers added 115,000 workers to payrolls, the fewest since October, according to the data. Economists project payroll growth expanded by about 150,000 this month, according to the median estimate in a Bloomberg survey. The Labor Department will issue its May employment report on June 1. Labor market progress would help rouse confidence after concerns about Europe’s debt crisis weighed on the U.S. stock market. The S&P 500 was down 7 percent from an almost four-year- high in early April through yesterday. “The economy and consumer sentiment remains fragile and we can foresee the possibility of more turbulence from outside events as we move through the year,” Stuart Brown, vice president and chief financial officer of Red Robin Gourmet Burgers Inc. (RRGB), said during a May 16 earnings call. Shares of the Greenwood Village, Colorado-based restaurant chain dropped last week by the most in two years after it said same-store sales will rise 1 percent this year. PetSmart Inc. (PETM) is among companies that are more upbeat. The Phoenix-based retailer of pet food, supplies and services said on May 22 that its first-quarter same-store sales climbed 7.4 percent. “Although the macroeconomic environment still holds some uncertainty, we remain cautiously optimistic about the outlook for 2012,” Lawrence Molloy, chief financial officer, said on the company’s earnings call. A saving grace could also come from less expensive prices at the pump. The average price of a gallon of gasoline fell to $3.67 yesterday from a peak this year of $3.94 in early April, according to AAA, the nation’s largest motoring organization. Consumers in today’s confidence report said they expect an inflation rate of 3 percent over the next 12 months, compared with 3.2 percent in the prior survey. Over the next five years, Americans expected a 2.7 percent rate of inflation, compared with a previously reported 2.9 percent in the previous report.
Current Conditions
Stocks and Jobs
‘Cautiously Optimistic’
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#2. To: Brian S (#0)
LMAO. A single pic blows you and your bullshit propaganda out of the water. From google.trends: Thanks for playing! :)
#3. To: Capitalist Eric (#2)
http://static.prisonplanet.com/p/images/may2012/250512run2.jpg "Prison Planet"...LOL And you oafs criticize my sources. {{{chuckle}}}
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